Stripe launches charge card program for Stripe Issuing
Stripe, a financial infrastructure platform for businesses, has announced a new charge card program for Stripe Issuing, Stripe’s commercial card issuing product.
With the addition of charge cards, fintechs and platforms can create and distribute virtual or physical charge cards that allow their customers to spend on credit rather than the funds in their accounts—providing new revenue streams for platforms and allowing them to offer new financing capabilities to their customers.
“Whether a small business is just starting out or looking to expand, access to capital can make all the difference. Our new charge card allows fintechs and SaaS platforms to provide access to a reliable source of credit for the many small businesses they work with,” said Denise Ho, head of product for BaaS at Stripe.
In a recent survey, 77% of SMBs said they were concerned about access to financing. Software platforms can help by providing access to capital that their customers use to boost growth. The addition of a charge card program also allows platforms to create deeper and more profitable ties with their customers. But building a credit offering from the ground up is hard. Platforms would need to collect repayment, handle lending compliance, navigate licensing requirements, and much more.
Issuing’s charge card program handles these issues out of the box, allowing platforms to quickly offer access to credit with little additional operational cost. Issuing provides the core components of a charge card program—such as funds flows, network connections, printing, and integration APIs—and streamlines all the necessary compliance, bank partnerships, and ledgering.
Businesses can set individual credit limits and repayment schedules, including flexible weekly, monthly, or set-day repayment options. When businesses need to collect repayments from customers, they can use Stripe’s suite of products, including no-code and embeddable options like Invoicing and Checkout.
The charge card program also provides flexible funding options for platforms. Once a card is used to make a purchase, the transaction needs to be funded. Most charge card programs require the platform offering the card to cover the transaction immediately, which forces platforms to maintain large cash balances. But with Issuing, platforms can send funds to Stripe after the transaction settlement date. This helps platforms reduce the funds they need to keep in reserve, freeing that cash for other purposes.
Ramp, Emburse, Karat, and Coast are already using the charge card program, which is available in beta in the US, and will later expand to the EU and the UK.